Not upheld: irresponsible lending and failure to exercise forbearance complaint against American Express Services Europe Limited (AESEL)

Decision detail

Summary

Mr K complained that AESEL acted irresponsibly by continuing to allow him to use his credit card despite repeated gambling transactions and by charging interest and fees while he was in financial distress between September 2024 and July 2025. AESEL had contacted Mr K in October 2024 about large payments to an online platform, and Mr K stated he had stopped gambling. Mr K continued to make repayments exceeding the minimum with no missed payments until July 2025, when he disclosed financial difficulty due to reduced earnings. The ombudsman found that AESEL had insufficient prior indication of financial difficulty to warrant intervention before the missed payment, and that they acted fairly once learning of Mr K's situation by freezing charges and arranging appropriate support.

The Ombudsman's reasoning

The ombudsman applied the relevant regulations requiring proportionate affordability checks and fair lending decisions. For the period September 2024 to July 2025, the ombudsman found that AESEL had no clear indication of financial difficulty prior to the missed payment in July 2025. Although Mr K was making payments to an online platform, AESEL had been reassured he had stopped gambling, and Mr K continued to make repayments well above the minimum with no missed payments. The self-reduction of credit limit to £900 was not, on its own without missed payments, a sign of financial difficulty. Once AESEL learned of Mr K's financial situation in July 2025, they acted fairly by requesting an income and expenditure form, freezing interest and charges, referring him to charities, and arranging for the account to be defaulted.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website